insured catastrophe losses

Based on preliminary insured loss estimates, the reinsurance sector and its capital providers are expected to assume at least 30% of total insured losses from the Palisades and Eaton wildfires in Los Angeles, according to analysts at Moody’s.

Initial loss estimate announcements for the Los Angeles, California wildfires from Bermudian reinsurance firm RenaissanceRe and global re/insurer Chubb may raise some concerns, as RenRe based its estimate on a $50 billion industry loss event, while Chubb also seems to be working from a relatively high industry figure.

According to independent insurance-linked securities (ILS) investment manager Euler ILS Partners, the Los Angeles, California wildfires could have a significant impact on US pricing, especially if insurance industry losses were to exceed $30 billion.

Insurance industry losses from the wildfires that impacted the Municipality of Jasper and Jasper National Park in Alberta, Canada between July 22nd and August 17th 2024, is estimated to have reached CAD $1.23 billion, according to CatIQ, Canada’s insured loss and exposure indices provider.

Analysts at Fitch Ratings have said that any realised catastrophe bond losses from the Los Angeles wildfires are expected to be small, however these are not anticipated to impede cat bond market issuance.

Catastrophe risk modelling specialist Karen Clark & Company (KCC) estimates that the insured loss (from privately insured and FAIR plan policies) to residential, commercial, and industrial properties, and autos from both the Palisades and Eaton wildfires in Los Angeles will sit close to $28 billion.

In a new update on the Los Angeles and Southern California wildfires, Evercore ISI analysts have said they believe that losses from the event are unlikely to change the trajectory of reinsurance pricing, which the firm anticipates will still be down 10% to 20% at the mid-year renewals.

Verisk’s Extreme Event Solutions division estimates that the insured industry losses to property from both the Palisades and Eaton fires in Los Angeles, will fall between $28 billion and $35 billion, driven primarily by losses to residential risks.

Insured catastrophe losses in Canada reached CAN $8.5 billion for full-year 2024, making it the largest loss year for the country on record, exceeding the previous record of CAN $6.2 billion recorded in 2016, according to CatIQ, Canada’s insured loss and exposure indices provider.

Canadian property and casualty insurer, Intact Financial Corporation, has continued to experience heavy catastrophe losses from wildfires and severe weather in the third-quarter, already announcing a CA $570 million toll, while also saying that these won’t trigger any reinsurance recoveries for the company.